HB4341 103RD GENERAL ASSEMBLY

LRB103 36333 MXP 66431 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB4341

Introduced 1/16/2024, by Rep. Curtis J. Tarver, II

SYNOPSIS AS INTRODUCED:

15 ILCS 505/16.11 new
35 ILCS 5/252 new
30 ILCS 105/5.1012 new

Amends the State Treasurer Act. Provides that the State Treasurer shall establish and administer the Invest in Illinois Higher Education Program for the purposes of expanding access to higher education through scholarships awarded from the Invest in Illinois Higher Education Fund. Amends the State Finance Act. Creates the Invest in Illinois Higher Education Fund. Amends the Illinois Income Tax Act. Creates an income tax credit in an amount equal to any donations made by the taxpayer to the Invest in Illinois Higher Education Fund. Effective immediately.

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The State Treasurer Act is amended by adding Section 16.11 as follows:

(15 ILCS 505/16.11 new)

Sec. 16.11. Invest in Illinois Higher Education Program.

(a) The State Treasurer shall establish the Invest in Illinois Higher Education Program. The State Treasurer shall administer the Program for the purpose of expanding access to higher education through scholarships awarded from the Invest in Illinois Higher Education Fund.

(b) The Invest in Illinois Higher Education Fund is hereby established as a special fund in the State treasury. The Fund may receive donations as provided in Section 252 of the Illinois Income Tax Act, as well as gifts, grants, and appropriations from any lawful source. The State Treasurer shall use moneys in the Invest in Illinois Higher Education Fund for the purpose of awarding scholarships to eligible students.

(c) As used in this Section:

"Eligible student" means an individual who is a member of a household with a federal adjusted gross income that, in the year before the student first receives a scholarship through the program established under this Section, is less than or equal to 300% of the federal poverty income guidelines and that, in any subsequent year in which the student receives a scholarship though the program, is less that or equal to 400% of the federal poverty level.

"Federal poverty guidelines" means the poverty guidelines updated periodically in the federal register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. 9902(2).

"Necessary costs and fees" includes tuition and the additional fixed fees charged for specified purposes that are required generally of non-scholarship recipients for each academic period for which the scholarship applicant actually enrolls, but does not include fees payable only once and other contingent deposits that are refundable in whole or in part. The State Treasurer may prescribe, by rules consistent with this Act, detailed provisions concerning the computation of necessary costs and fees.

"Scholarship" means an educational scholarship awarded to an eligible student to attend a community college or public university in the State in an amount not exceeding the necessary costs and fees to attend that school.

Section 10. The Illinois Income Tax Act is amended by adding Section 252 as follows:

(35 ILCS 5/252 new)

Sec. 252. Invest in Illinois Higher Education credit.

(a) For taxable years ending on or after December 31, 2024, each taxpayer who makes a donation to the Invest in Illinois Higher Education Fund during the taxable year is entitled to a credit against the tax imposed by subsections (a) and (b) of Section 201 in an amount equal to that donation.

(b) For partners, shareholders of subchapter S corporations, and owners of limited liability companies, if the liability company is treated as a partnership for purposes of federal and State income taxation, the credit under this Section shall be determined in accordance with the determination of income and distributive share of income under Sections 702 and 704 and subchapter S of the Internal Revenue Code.

(c) The credit may not be carried back and may not reduce the taxpayer's liability to less than zero. If the amount of the credit exceeds the tax liability for the year, the excess may be carried forward and applied to the tax liability of the 5 taxable years following the excess credit year. The tax credit shall be applied to the earliest year for which there is a tax liability. If there are credits for more than one year that are available to offset the liability, the earlier credit shall be applied first.

(d) This Section is exempt from the provisions of Section 250.

Section 15. The State Finance Act is amended by adding Section 5.1012 as follows:

(30 ILCS 105/5.1012 new)

Sec. 5.1012. The Invest in Illinois Higher Education Fund.

Section 99. Effective date. This Act takes effect upon becoming law.